Financial Services Edition€“The–Insights–Review... · Internal Consulting Group Pty Ltd 2015 10 Financial Services: Industry Categories “The 2015 Global Innovation 1000:

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Reviews of the World’s Leading Financial Services Industry Insights

The

© Internal Consulting Group Pty Ltd 2015

Financial Services Edition

October - November 2015

Articles of the Month: “Global Payments 2015: Listening to the Customer’s Voice” – BCG & “European Motor Study: Ready for the Customers’ Switch?” – Deloitte ►

General Strategic Interest

Retail & Business Banking

Payments

Corporate & Investment Banking

Wealth & Asset Management

Insurance

Strategy & Transformation

Corporate Finance / M&A

Regulation & Compliance

Corporate Governance

Human Capital

Women at Work

Finance & Risk

Marketing & Customer Experience

Technology

Operations & Change


Contents


The


Articles of the Month: “Global Payments 2015: Listening to the Customer’s Voice” – BCG & “European Motor Study: Ready for the Customers’ Switch?” – Deloitte ►

Financial Services: Industry Economic ContextGeneral Strategic Interest � 5

Financial Services: Industry CategoriesFintech, Disruption & Innovation � 8

Retail & Business Banking � 11

Payments � 13

Corporate & Investment Banking � 17

Wealth & Asset Management � 18

General Insurance � 21

Life Insurance � 23

Financial Services: Functional CategoriesStrategy & Transformation � 24

Corporate Finance / M&A � 27

Regulation & Compliance � 30

Corporate Governance � 31

Human Capital � 32

Diversity � 33

Finance & Risk � 35

Marketing & Customer Experience � 37

Technology � 40

Special FeatureThe Best Insights from the Past 12 Months � 42

ContributorsThe Insights Review Team � 49

About ICG �An Introduction to Internal Consulting Group � 51


About this ReportThe Insights Review – Financial Services

Edition by ICG presents timely abstract

reviews of the most relevant ‘open published’

perspectives and research reports from

the world’s leading branded management

consulting firms.

This publication ensures that executives

and consultants are exposed to the widest

range of high quality ideas, techniques

and methodologies developed across the

management consulting industry globally.

Relevant insights are identified and classified

once only, either in a general category, or by

topic alignment to an industry segment or a

functional area using our proprietary taxonomy.

Access to Full ReportsIf you find an insight review of interest and

wish to access the full report, simply follow the

link beneath the title. Where possible, this will

take you to the full report. Occasionally, the

publisher may require the user to complete

a registration or payment process prior to

accessing the report.

Links are current at time of publication.

Insight SourcesICG sources candidate insights for review

from the best and most relevant material

published openly by (at least) the following

branded consulting firms:

• Accenture

• AT Kearney

• Bain

• BCG

• Capgemini

• Deloitte, Touche & Tohmatsu

• Ernst & Young

• FMCG

• IBM

• KPMG

• McKinsey & Company

• Oliver Wyman

• Promontory

• PwC

• Roland Berger

• Strategy&

© Internal Consulting Group Pty Ltd 2015 3


A Message From the EditorWelcome to one of our twice yearly bumper double issues. This

month we aggregate two months of insights so you have some great

winter/summer holiday reading. Whether you skim now and pick your

favorite articles to read in full, or you wait until the end of your break so

you can ease gently back into work mode, we hope you find our global

edition of The Insights Review as insightful and time-saving as ever.

Our joint articles of the month for this issue are:

• BCG – “Global Payments 2015: Listening to the Customer’s Voice”;

• Deloitte – “European Motor Study: Ready for the Customers’

Switch?”.

From all of us at The Insight Review and ICG – we wish you a happy

and safe season break!

David Moloney

Global Editor

mailto:[email protected]


“Overcoming Asia’s Obstacles to Growth” – BCG

View PDF (24 Pages)

An insight which highlights three problems you will

face trying to capture the Asian century, along with

BCG advertorial and case study fodder on how to best

address.

From the many potential issues, the three selected

(with scant justification) are regulation, talent, and

infrastructure. The answers vary but the common

themes are move early, be flexible, and invest for

the long term. Of the new insights, the Air Asia story

of joint venturing with local partners and being the

minority partner – so they get access to licences, but

with the local partner being a non-airline – is the stand

out.

“A Tale of Three Asia’s” – McKinsey

View PDF (2 Pages)

Clever analysis from McKinsey’s Budapest office.

This article makes the non-intuitive point that banking

growth is not more centralised the more developed

the economy is.

The example they use is that growth in emerging

Asia is split evenly across the top 10 cities, other cities

and rural. In developed Asia, it is the top 10 cities

(centralised urbanization) but in China it is the other

cities (distributed urbanization).

Financial Services: Industry Economic Context

GENERAL STRATEGIC INTEREST

https://www.bcgperspectives.com/content/articles/globalization-growth-overcoming-asia-obstacles-growth/

http://www.mckinsey.com/insights/financial_services/a_tale_of_three_asias


“Capturing Southeast Asia’s Financial-System Opportunity” – McKinsey

View PDF (2 Pages)

A 4-minute video and 1-page summary discussion

of very high-level perspectives on electronification

of cash across the growing and enriching consumer

populations of ASEAN countries.

It is easy to be sceptical about McKinsey’s

motivations for showcasing high trajectory executives

in this way.

“Financial Deepening in Indonesia” – Oliver Wyman

View PDF (52 Pages)

An authoritative diagnosis and comprehensive

recommendations for deepening of financial markets

in Indonesia. Deepening is defined as when the

efficiency, depth, breadth, and reach of financial

markets improves.

The insight reveals that the deepest financial

markets share four characteristics: funding access,

diversified investment options, quality market

infrastructure, and risk management solutions.

Lengthy but worth a read.


http://www.mckinsey.com/Insights/Financial_Services/Capturing_Southeast_Asias_financial_system_opportunity?cid=other-eml-alt-mip-mck-oth-1509

http://www.oliverwyman.com/content/dam/oliver-wyman/global/en/2015/sep/Financial_Deepening_In_Indonesia.pdf


“Divergence, Disruption, & Innovation Global Trends 2015-2025” – AT Kearney

View PDF (31 Pages)

Sensible laundry list of mega trends with

one-, five-, and 10-year prognostications gilded

with the imprimatur of the AT Kearney Global

Business Council (somewhat inconsistently, the

report also acknowledges just two authors).

What follows is a predictable list of geo-political

and technologically disruptive trends that we have

seen before – but that will save many an Internal

Consulting Unit from compiling from across the

consulting industry or this journal.

Internal Consultants wanting to see something

fresh should turn to the very last trend – the

changing nature of power.

Those looking for even fresher material might

consider: hyper scale platform based business

models, rise of women, empowerment of the

young and other trends that can be rigorously

exposed through ICG’s unique Industry

Disruption Scan (IDS) methodology.


https://www.atkearney.com/documents/10192/6823532/Divergence%2C+Disruption%2C+and+Innovation.pdf/46a91bee-a805-442a-b962-bf4db07c77f4


“A New World of Opportunity: The Insurance Innovation Imperative” – KPMG

View PDF (46 Pages)

This wordy 40-page report about innovation in the

life, health, and general/P&C insurance sectors in

Europe, North America, and Asia tries to cover too

broad a scope and suffers for it. It mixes three things:

selected findings from a survey of 280 insurance

execs from around the world; short interviews with

some of these about innovation in their firms; and

lots of editorial and observations and opinions from

various KPMG partners about the importance of

innovation and how to do it. A theme of the report is

there are no silver bullets or off-the-shelf solutions for

innovation, so you should try lots of things all the time

and adapt ideas from everywhere. The report tries

to help. On some pages there are survey findings to

compare what others do, and interviews with insurers

and examples of their innovations. Best pages are 3, 4,

8, 9, 16, 18, 19 and 25.

“Six Building Blocks for Creating a High-Performing Digital Enterprise” – McKinsey

View PDF (8 Pages)

A high-level framework for categorizing how digital

technology is changing all aspects of business

models and organizational functions, resulting in lots

of integration and transformation challenges. Most

readers wouldn’t find anything new in this. Your time

would be better spent reading some of the more

focussed and in-depth sources mentioned in the

footnotes or published more recently in other journals.

For example, under the “Customer Decision Journey”

category, the “Competing on Customer Journeys”

article in Harvard Business Review (Nov 2015) by one

of the co-authors is much more interesting.

FINTECH, DISRUPTION & INNOVATION

Financial Services: Industry Categories

https://assets.kpmg.com/content/dam/kpmg/pdf/2015/09/the-insurance-innovation-imperative.pdf

http://www.mckinsey.com/insights/organization/six_building_blocks_for_creating_a_high_performing_digital_enterprise

https://hbr.org/2015/11/competing-on-customer-journeys



“Case Studies in Funding Innovation” – Deloitte

View PDF (76 Pages)

Five case studies are used to illustrate emerging

principles for finding and funding breakthrough

early stage ideas. While written for philanthropic

foundations and social impact investors, the eight

principles described are also relevant to corporate

venturing and government innovation support

programs. In addition to being interesting and well-

written stories, the case studies provide a timely

reminder that innovation journeys are neither smooth

nor predictable.

“Demystifying the Hackathon” – McKinsey

View PDF (4 Pages)

A short explainer of how a start-up style hackathon

can be used in a corporate context to do rapid 1-2

day ideation and prototype development with cross-

functional teams. The article says enough for you to

be able to compare with the longer lean, agile, and

scrum processes you are probably more familiar with.

It also touches on the change management benefits

and risks, in particular that the staff involved will get

highly motivated and expect rapid follow through by

the organization.

http://dupress.com/articles/case-studies-in-funding-innovation-kiva/

http://www.mckinsey.com/insights/innovation/demystifying_the_hackathon



“The 2015 Global Innovation 1000: Innovation’s New World Order” – PwC

View PDF (20 Pages)

This is the 10th annual survey of R&D expenditure

trends among the world’s 1000 largest corporate

spenders. It has charts and commentary covering

trends across geographic and industry segments.

These focus on the changes in and trends regarding

where R&D is being done. It is no surprise to see that

Asia now hosts the largest share, thanks both to the

growth of Asian corporations and to multinationals

diversifying their locations for R&D activities. This

insight is most relevant to internal consultants in

multinationals and policy makers in governments.

“Harnessing the Power of Entrepreneurs to Open Innovation” – Accenture

View PDF (7 Pages)

An insight summarizing a large survey of

corporations and entrepreneurs and their experiences

of collaborating with each other in the digital space.

It also ventures a hypothesis that collaboration

needs to evolve from the current phase of incubators,

accelerators, and corporate venturing to an “open

innovation model”… without really explaining what

that is. However, some of the survey findings ring

true, particularly the one about entrepreneurs having

higher expectations of collaboration than their

corporate collaborators, and often feeling let down by

a perceived lack of reciprocal commitment. Of course

a corporation will probably want to collaborate with

many entrepreneurs, so commitment to any one of

them is likely to be rationed and potentially fleeting

– hence why it’s hard to make collaboration work for

both sides.

http://www.strategyand.pwc.com/media/file/The-2015-Global-Innovation-1000-Media-report.pdf

https://www.accenture.com/us-en/_acnmedia/Accenture/next-gen/B20/Accenture-DCI-Report-Final.pdf



“Retail banking in Asia Actionable Insights for New Opportunities” – Bain

View PDF (106 Pages)

At almost 100 pages across 8 chapters, this is a

lengthy read, comprehensively covering the rapid

and disruptive change taking place across the

Asian banking market and impacting on traditional

banking models. The Asian region includes a blend

of developed and emerging economies, serviced by

a mix of national and intra-regional banks. McKinsey

explores the impact of changing banking paradigms

within this context.

A number of themes are separately explored,

including margin pressure, digital banking, the

changing role of branches, sales transformation, and

private banking. Each theme is provided lengthy

coverage supported by insightful charts and case

studies, and with a focus on capability-building.

This will reward a patient read, however a time-poor

executive will also find useful nuggets through a quick

scan. Highlights for us included “next-generation risk

skills” (p.5), “getting the branch ready for multichannel”

(p.28), and “practical insights from customer data“

(p.60).

A key overall insight is that even in less evolved

economies, consumer expectations across digital

channels are becoming increasingly sophisticated,

and that from Hong Kong to Delhi, customers are

looking for speed, convenience, flexibility, and

customization.

“Escaping the Doom Loop in Contact Center Operations” – Bain

View PDF (2 Pages)

This is a good quick refresh for those working

on service centre productivity. Short and sharp,

this article suggests key levers for retail banks to

manage and reduce call centre volumes, based on

examples where reductions of 20-40% have been

achieved. These range from classic productivity

actions (measure and monitor) to using newer digital

approaches (develop a demand intelligence hub).

Naturally, Bain doesn’t miss the chance to plug Net

Promoter Score (NPS) metrics.

RETAIL & BUSINESS BANKING

http://www.bain.com/publications/articles/escaping-the-doom-loop-in-contact-center-operations.aspx



“Consumer Lending: Understanding Today’s Empowered Borrower” – PwC

View PDF (34 Pages)

PwC’s study demonstrates the accelerating march

of consumer expectations across digital channels,

especially among younger client segments. The

study finds that borrowers are increasingly looking

for a predominantly digital transaction experience

– significantly more so than even 2 years ago – and

would like their digital banking transactions to

resemble the fast, seamless, and intuitive digital

experiences offered across other industries.

A key finding is that the current slate of mobile apps

available on the market do not provide the range of

features that banking customers expect based on their

broader digital interactions, as revealed by the table of

digital features helpfully included.

While the article starts briskly and brightly with an

initial nine pages of fast-paced and well-packaged

digital insights, it then shifts to a clunky gear and

labours to the finish line over another 20 pages of

segment analysis that can be skipped by Internal

Consultants.

“Low Interest Rates Six Actions for Retail Banks to Overcome the Impasse” – Oliver Wyman

View PDF (12 Pages)

This article tracks the impact of prolonged low

interest rates on European retail banks, as a number

of drivers are combining to place pressure on retail

banking profitability. These include record low deposit

rates – making it difficult for banks to widen spreads

– and a trend towards fixed-rate lending in place of

variable.

Retail banking consultants working on

performance improvement initiatives may benefit

from Oliver Wyman’s well-researched summary of

the multifaceted relationship between monetary

policy and banking profits. However, the resolution

disappoints as their solution package amounts to a

somewhat shallow and uncontextualized walkthrough

of the retail banking value driver tree.

http://www.pwc.com/us/en/consumer-finance/assets/pwc-consumer-lending-radar.pdf

http://www.oliverwyman.com/content/dam/oliver-wyman/global/en/2015/oct/2015_Oliver_Wyman_Low_interest_rates.pdf



“Serving Connected Customers: How Merchants & Payment Providers Can Win in a Digital World” – Strategy&

View PDF (15 Pages)

A U.S.-centric article referencing a Strategy &/

Electronic Transactions Association consumer (1000+),

merchant (25+) and payments industry executive (50+)

survey.

It contains a few interesting statistics, mainly

highlighting the disparity in priorities between the

three different groups surveyed. The report concludes

that as digital commerce has seen dramatic growth,

payments must become an integral part of the digital

consumer interaction. It also argues that payment

providers must do a better job of leveraging data to

provide merchants richer customer information and

insights.

One particularly interesting observation, albeit

from a small sample, is that 25% of U.S. merchants

surveyed don’t yet have a mobile wallet strategy.

“How Addressing Consumers’ Concerns About Data Security Opens the Doors to Growth” – AT Kearney

View PDF (13 Pages)

Another U.S. article drawing on external research,

this time the 2015 Visa Digital Consumer Study which

surveyed over 10,000 consumers online at the end of

2014.

The angle on this occasion is that consumer security

concerns are holding back growth in online commerce.

The survey reports that 24% of consumers cite

security concerns as the reason for not making an

online purchase, yet the report glosses over the fact

that 51% of respondents don’t buy online because

they prefer to see or feel the product first!

The report concludes that banks are in a unique

position to pursue and promote security solutions that

improve consumers’ comfort and confidence in digital

payments… a segués to tokenization solutions, such

as Visa’s Token Service perhaps!

PAYMENTS

http://www.strategyand.pwc.com/global/home/what-we-think/reports-white-papers/article-display/serving-connected-customers

http://www.atkearney.com.au/paper/-/asset_publisher/dVxv4Hz2h8bS/content/how-addressing-consumers-concerns-about-data-security-opens-the-doors-to-growth/10192?_101_INSTANCE_dVxv4Hz2h8bS_redirect=%2Fissue-papers-perspectives



“Five Imperatives for Navigating Turbulence in the Payments Ecosystem” – Bain

View PDF (12 Pages)

With themes common to both the previous articles,

this is by far the best and makes for an interesting and

enjoyable read.

The international flavour of the report also provides

much broader appeal and some genuine insights.

The premise is that merchant acquirers (banks or

specialist payments companies) must evolve from

being utility providers to technology-focused partners.

The article sets out five imperatives: avoiding

disintermediation; segmenting the customer base

(here, the profitability and hence attractiveness of

the SME segment is exposed); protecting one’s

distribution channel; embracing new payment types;

and defending data.

Interestingly, the report highlights the move towards

tokenization, which while promoted enthusiastically

elsewhere, actually has the potential to limit much of

the desired consumer data.

“2015 North America Consumer Digital Payments Survey” – Accenture

View PDF (20 Pages)

Accenture’s annual survey of Canadian and U.S.

consumer payment preferences was completed in

June/July 2015 and sampled around 4,000 consumers.

Key conclusions, as digital payment adoption grows,

is to keep payment solutions Simple, Personal and

Everyday. No huge changes on last year’s survey,

with traditional payments such as cash remaining

robust and digital gaining ground, especially mobile,

with Apple Pay now commanding an estimated 2 in 3

dollars of all U.S. mobile contactless spend.

The survey also reports for the first time peer-

to-peer (P2P) payments use with 15% of survey

respondents claiming at least weekly use. The report

also touches on the development of payments

functionality for connected devices (the Internet of

Things), two areas to watch in the coming year.

http://www.bain.com/Images/BAIN_BRIEF_Turbulence_in_the_payments_ecosystem.pdf

https://www.accenture.com/t20151021T165757__w__/us-en/_acnmedia/Accenture/next-gen/na-payment-survey/pdfs/Accenture-Digital-Payments-Survey-North-America-Accenture-Executive-Summary.pdf#zoom=50


Article of the Month


“Global Payments 2015: Listening to the Customer’s Voice” – BCG

View PDF (31 Pages)

The best payments article we have reviewed in 2015,

an excellent and insightful report produced by BCG

with support from SWIFT.

The multi-faceted report starts by focusing on global

transactional banking revenues predicting that they

will grow from USD1.1 trillion in 2014 to nearly USD2

trillion by 2024, with growth driven by a combination

of account, transaction, and non-transaction card

revenues.

Once past the revenue analysis, there is a

comprehensive regional review of market dynamics

(pages 7 to 10) that provides a thoughtful digest of

developments across the globe – including some great

insights into what is happening in China and India.

The report also references a 5,500 consumer survey

conducted in France, Germany, the United Kingdom,

and U.S. that seeks to identify barriers to digital

adoption.

Finally, pages 19-25 focus on Wholesale Transaction

Banking developments, rarely reported with this level

of insight and advice.

“World Payments Report 2015” – Capgemini

View PDF (60 Pages)

A weighty report based on publicly available data

sources, the firm’s own analysis/ forecasts, and a May

2015 global survey of 411 banks, other financial sector

institutions, IT and advisory firms. Given the time lag

in reporting and aggregating information, most data

relates to 2013 and 2014.

This report is worth dipping into, but is not an easy

cover-to-cover read. The section on key regulatory

and industry initiatives highlights a range of global and

more localized hot topics, and there is also a strong

section on the continued development of real-time/

faster payments.

https://www.bcgperspectives.com/content/articles/financial-institutions-digital-economy-global-payments-2015-listening-customer-voice/

https://www.worldpaymentsreport.com/download



“Global Payments 2015: A Healthy Industry Confronts Disruption” – McKinsey

View PDF (34 Pages)

Another global summary of payments data and key

industry trends, this time drawn from the firm’s own

analysis across more than 40 countries. McKinsey’s

estimates 2014 Global Payments Revenue at USD

1.7 trillion – this being substantially higher than

BCG’s numbers and emphasizing differences in

measurement, and more fundamentally the challenge

of accurately capturing data on a global basis.

Digital disruption and the threats to banks, both

from the large technology players but also a plethora

of start-ups and disrupters, are covered, as is some

interesting analysis on the market threats in foreign

exchange/international remittances which are likely to

present growing challenges to cross-border payments

revenues.

“Bitcoin at the Crossroads: There is a Race to Regulate Bitcoin. Is it too Soon?” – Deloitte

View PDF (8 Pages)

A very short piece questioning whether the

regulatory attention being directed to Bitcoin is

appropriate given transaction volumes are ‘just a

drop in the ocean’, and that over-regulation may well

stifle the development of the underlying blockchain

technology – not just for payments, but a myriad of

other uses that require establishing trust between

unknown parties.

Worth a very quick skim by Internal Consultants

with an interest in the payments sector.

http://www.mckinsey.com/client_service/financial_services/latest_thinking

http://www2.deloitte.com/us/en/pages/regulatory/bitcoin-at-the-crossroads.html



CORPORATE & INVESTMENT BANKING

“Corporate & Investment Banking Outlook 2015” – Roland Burger

View PDF (24 Pages)

This report from Roland Berger contains much more

insight than a reader would expect from the bland title

or Executive Summary which lists the well-known (if

not well-actioned) issues for this sector, viz.; cost and

capital deployment, client centricity, digital transition,

and cultural empowerment.

For all with an interest in CIB, your reviewer thinks

it is worth getting into the content; less said here, will

give you more time to act there.

“A Mile Wide or a Mile Deep? The Diversification Opportunity Facing Private Equity” – BCG

View PDF (16 Pages)

This concise ‘advertorial’ by BCG is likely to

be merely of interest to executives and internal

consultants not directly involved in PE, but it is worth

a quick read in the holidays.

It sets out the PE landscape, which over the past

decade has seen the topography of mainly mountain

peaks – leveraged buyout (LBO) funds – flatten out to

a plateau, with diversified PE firms that are more akin

to Asset Managers, and with an escarpment between

the two – of those firms that are selectively diversified.

As PE firms increase in size, there may not be enough

sizeable opportunity to sustain them in the mountain

peaks hence the move to the plateau for the largest

(see page 10 for an exhibit of who is where). Your

reviewer ponders: “Are diversified funds the return of

conglomerates of the mid-20th century?”

http://www.rolandberger.com/media/publications/2015-09-02-rbsc-pub-corporate_and_investment_banking_outlook_2015.html

https://www.bcgperspectives.com/content/articles/private-equity-mile-wide-mile-deep-diversification-opportunity-facing-private-equity/



WEALTH & ASSET MANAGEMENT

“Investors: A Critical & Growing Factor for Success in the Wealth” – Deloitte

View PDF (6 Pages)

There are few top-tier firms authoring articles on

the appeal of a dedicated value proposition to women

clients in the wealth industry. This short article from

Deloitte claims there is $5T of funds controlled by

women in the US that is not managed by a financial

adviser. It bases the need for a dedicated value

proposition on the fact that women rate advisors lower

on every aspect of satisfaction compared to how men

rate advisors. A second data point – not cited in this

article – is that women are far more likely than men

to feel they need financial advice. The business case

therefore is compelling, however the recommended

approach to capture the market is rather high-level

and rapidly becomes a Product Design and Marketing

Strategy 101 checklist. The most valuable takeaway

ends up being a reminder of the growing importance

of the segment.

“Freeing the Future? Market Impacts of the Pension Freedom Reforms” – KPMG

View PDF (24 Pages)

For anyone not close to the momentous “Pension

Freedoms” changes to the UK pension system, this

report is an excellent starting point. One of two

reports from KPMG into the industry, this first article

describes the background to the reforms and outlines

the subsequent challenges facing consumers, industry,

and government. It is an insightful and thought-

provoking read for policy-makers and advisers in any

jurisdiction wrestling with the challenges of optimizing

their pension settings. Those already well-versed in

the challenges in the UK may want to wait for the

second report, which will examine the longer-term

outlook for the changing pension landscape.

http://www2.deloitte.com/content/dam/Deloitte/us/Documents/strategy/us-cons-women-investors.pdf

https://www.kpmg.com/UK/en/IssuesAndInsights/ArticlesPublications/Documents/PDF/Market Sector/Financial Services/freeing-the-future-v2.pdf



“The Evolution of China’s Private Wealth Market” – Bain

View PDF (20 Pages)

There are over one million HNWIs in China – double

the number in 2010. Only 25% of HNWIs used

advisers in 2010, but that percentage has now risen to

65%. These are some of many statistics cited in this

20-page summary from Bain’s latest survey of China’s

wealth industry. It is a data- and chart-packed page-

turner full of insight about industry structure, market

size, HNW needs, and their investment preferences.

Light on interpretation and implications, the article

is for internal consultants and industry strategists

seeking robust data to support analysis and inform

strategy.

“It Got so Late so Soon: Wealth & Asset Managers Awake to the New Digital Age” – EY

View PDF (5 Pages)

Another article about the impact of digital

technologies on the wealth industry. At six pages, this

one is short, useful really only for industry outsiders

without any background in fintech-for-wealth and who

may therefore appreciate a very high-level summary.

However, it does not bring new thinking to the topic so

is a pass for our regular readers.

http://www.bain.com/publications/articles/the-evolution-of-chinas-private-wealth-market.aspx

http://www.ey.com/Publication/vwLUAssets/ey-wealth-and-asset-managers-awake-to-new-digital-age/$File/ey-wealth-and-asset-managers-awake-to-new-digital-age.pdf



“Asset Management 2020 & Beyond: Transforming Your Business for a New Global” – PwC

View PDF (32 Pages)

An excellent article from PwC describing how global

tax transparency is forcing the asset management

(AM) industry to evolve from performance alpha

towards “service alpha”, where the primary

competitive differentiator will be investment

performance after tax. Welcome to the new world of

cross-jurisdictional tax reporting and perpetual audits

as global mega-managers attract huge interest from

tax authorities. The article is a great read – written

in diary format from the perspective of the executive

team of a major asset manager describing the

day-to-day challenges during a busy week through

a reporting cycle. Of general interest to all asset

managers, but particularly to internal consultants and

tax strategists.

http://www.pwc.com/gx/en/industries/financial-services/asset-management/publications/asset-management-tax-2020.html


Article of the Month


GENERAL INSURANCE

“Can Cyber-insurance Coverage Keep Apace with Cyber-Exposure?” – Towers Watson

View PDF (27 Pages)

A timely reminder article on one of the post market-

challenging emerging risks for insurers. Written with a

US market backdrop but with clear global overtures,

the key messaging surrounds the assessed inability

of insurers to fully understand this emerging risk to

allow classic capital allocation and pricing to the risk.

The article explores the needs for (and sees as huge)

the uncertainties of respondents – governments and

insurers – especially in the area of cyber-terrorism,

and concludes more innovative approaches are still

needed.

The recognition that this is complex and the good

work being done, whilst helpful, may leave Internal

Consultants wondering...

“European Motor Study: Ready for the Customers’ Switch?” – Deloitte

View PDF (30 Pages)

Whilst European focussed – which is a massive

combined market for motor insurance – this is one of

the best pieces around customer behaviors, with rich

case studies, seen for some time. Whilst the perennial

digitalization messages and the need for focus and

execution are also referenced, the power of this article

is the richness of demographic and behavioral study.

Telematics and other well-covered motor topics are

not a focus here.

The context of market sizes for countries, the

marginal profitability, and the low growth rates set

the scene and highlight the need for differentiation

of offerings (particularly given the greater propensity

of customers to shift) alongside a need for sharper

delivery focus.

A great read for Internal consultants and C-suite

alike, given the status of motor business in most

(European) countries.

https://www.towerswatson.com/en/Insights/Newsletters/Global/Emphasis/2015/emphasis-2015-3-can-cyber-insurance-coverage-keep-apace-with-cyber-exposure

https://www2.deloitte.com/content/dam/Deloitte/no/Documents/financial-services/deloitte-uk-consulting-euro-motor-study-2015.pdf



“From Solos to Symphony: How Insurers can Harmonize Customer Communications” – PwC

View PDF (10 Pages)

Multi-media, multi-touch, multi-messaging is the

area under review here, with the customer as the

target being portrayed as sometimes bombarded,

sometimes neglected in times of need, and probably

at best a combination of the worst of both. So what is

to be done?

The crux of this article is the promotion of

coordinated communication content creation, tied

to considered delivery media and careful timing of

output with a centralised governance approach. This

is compared to a traditional silo led approach which

has been seen as ‘closer’ to the customer. With the

multi-channel and almost instantaneous availability

of messaging to carriers and customers alike, this

traditional flexibility is seen as more of a hindrance

compared with a fully integrated and centrally

governed ‘portfolio driving individual’ customer

strategy.

PwC lay out a discussion to provoke change in

governance models relying on smarter technology,

better insights, and more considered measurement

metrics to deliver greater relevance to customers.

A relatively high-level read of use to internal

consultants in the main.

https://www.pwc.com/us/en/financial-services/publications/assets/fsi-whitepaper-customer-communication-insurance.pdf



LIFE INSURANCE

“Life Insurance Distribution at a Crossroads: Introducing the Agent of the Future” – EY

View PDF (12 Pages)

With the article predicting half the life agents in

the US will retire within the next few years and that

customer behavior is also changing, the report opens

an interesting subject and highlights some interesting

questions. After the first few pages, the educated

reader could be forgiven for thinking it is developing

into an insightful read… but they will then be left sadly

wanting when both the question and the report finish.

Without potential answers and the context of the

local regulatory framework overlay, this is I suspect

most useful for those looking to frame some trends

and the kinds of areas a forward-looking distribution

strategy may wish to consider.

http://www.ey.com/Publication/vwLUAssets/ey-life-insurance-distribution-at-a-crossroads/$FILE/ey-life-insurance-distribution-at-a-crossroads.pdf


Financial Services: Functional Categories

STRATEGY & TRANSFORMATION

“The Return of Corporate Strategy in Banking” – Bain

View PDF (12 Pages)

A timely call to arms for the application of bigger

guns to the question of strategy.

The core of the article is that oldie-but-a-goodie

chart displaying a wide distribution of performance by

players in the same industry. It is used to support the

argument that differentiation and sustained results are

not emergent, but rather due to clear choices which

necessarily compromise short-term performance.

The sceptics will revert to form; some CEOs will

agree to meet with Bain to hear their latest pitch; and

internal consultants will marvel at the new iconized

depiction of a business model in 5 and 6. We also

liked 3 because ambition is often not stated (as

Rumelt’s classic Good Strategy, Bad Strategy told us).

“The Science of Organizational Transformations” – McKinsey

View PDF (8 Pages)

A useful addition to the applied science of

transformation. McKinsey makes a compelling case

for starting a transformation with a more explicit

design phase that bakes in four best practices

which contribute to higher and higher transformation

success. The familiarity of the factors might however

lessen the impact of the insight. They are: leader role

modelling; fostering understanding and conviction;

hard wiring change; and equipping staff with the

required skills which most internal consultants would

consider business as usual.

http://www.bain.com/publications/articles/the-return-of-corporate-strategy-in-banking.aspx

http://www.mckinsey.com/insights/organization/the_science_of_organizational_transformations?cid=other-eml-alt-mip-mgi-oth-1509



“Collaborative Optimization: When Doing Another RFP is not Enough” – AT Kearney

View PDF (12 Pages)

Neatly packaged refinement to ATK’s renowned

approach to procurement. Uses a more iterative, open,

and collaborative process which actively searches for

sweet spots beyond price – not unlike the way ICG

says don’t hire a consulting pyramid from ATK when

you can compose a unique permutation of labour, IP,

and method from ICG to perfectly complement your

existing resources.

A minor concern is the existence of just a single

author – major successful steps forward generally

have many “inventors” or have become co-owned by

others, so this one might benefit from more polishing.

“The Double Game of Digital Strategy” – BCG

View PDF (8 Pages)

A very helpful “how-to” on digital strategy that nicely

articulates a more pragmatic approach to digital than

a previously awarded article Borges Map.

Recommended for all consultants looking for short,

sharp problem framing with some fresh examples that

can feed into your next internal consulting workshop.

https://www.atkearney.com/documents/10192/6627542/Collaboration+Optimization.pdf/4348a0b1-a9d3-4791-9ad4-80c2f94a41d1

https://www.bcgperspectives.com/content/articles/business-unit-strategy-big-data-advanced-analytics-double-game-digital-strategy/

http://digitaldisrupt.bcgperspectives.com/images/BCG_Borges_Map_Jun_2015.pdf



“Nine Questions to Help You Get Your Digital Transformation Right” – McKinsey

View PDF (6 Pages)

A grappling hook of ideas being thrown over a wall

to catch a client’s interest with one of its flukes.

It contains lots of old friends like cross-functional

teams and customer journey mapping, together with

an Exhibit so full of the latest jargon terms it would

make for an annual buzzword glossary for 2015.

There is little to recommend here. Feels like the

federated McKinsey model is pouring out IP faster

than the Global curation machine can manage.

http://www.mckinsey.com/insights/organization/nine_questions_to_help_you_get_your_digital_transformation_right



CORPORATE FINANCE / M& A

“Mega-Mergers in Health Insurance: 10 Steps to Successful Integration” – Bain

View PDF (4 Pages)

A one page analysis of the consolidation taking

place in the US health insurance industry, as

large insurers respond to the forces unleashed by

Obamacare. The other three pages provide Bain’s

take on the steps to successful M&A and post-merger

integration. These recap familiar advice, like having a

detailed integration plan ready, and moving quickly to

secure talent and sort out the power structure. The

unfortunate reality is that many M&A deals still fail

to realize the benefits Boards were sold on. Clearly

success requires more than a 10-step guide.

“Rethinking M&A Valuation Assumptions” – Bain

View PDF (8 Pages)

An opinion piece aimed at CFOs that asserts –

without presenting evidence – that many of them are

walking away from good acquisitions because they’re

using old (and too high) hurdle rates that are making

deals look expensive. You should read this only if

you’re in the mood for a lecture on how to update your

hurdle rate for a world Bain predicts will continue to

have low interest rates and abundant capital for some

time to come.

http://www.bain.com/publications/articles/mega-mergers-in-health-insurance-steps-to-successful-integration.aspx

http://www.bain.com/publications/articles/rethinking-ma-valuation-assumptions.aspx



“Building a Better Partnership Between Finance & Strategy” – McKinsey

View PDF (4 Pages)

An exhortation to “strategic” CFOs on the one

hand, and on the other executives and business unit

managers who traditionally own strategy to work

together and combine their complementary skills and

power to make better decisions and get things done.

The article goes on to discuss hypothetical ways they

could team up to improve the process for strategy

issues like investments for growth and M&A. All

common sense stuff, but a CEO should be concerned

if his or her senior management team actually needs

this advice on how to work together on strategy.

“Grow Fast or Die Slow: The Double-Edged Sword of M&A” – McKinsey

View PDF (6 Pages)

This article discusses the importance of good M&A

capabilities for high growth software/SaaS firms. It

presents data showing a strongly positive correlation

between their organic growth rates and the numbers

of acquisitions they make. This is an interesting

observation, but the authors stretch the data too far

and present correlation as causality, asserting that

organic growth rate can be increased by making

frequent acquisitions (2-3 p.a.), and the corollary that

infrequent acquirers damage their organic growth

rate. These would be powerful conclusions but for the

possibility that the reverse causation could also be

true, that firms with high organic growth rates are able

to do more acquisitions. Read this article if you are

interested in the data, but not for the conclusions.

http://www.mckinsey.com/insights/corporate_finance/building_a_better_partnership_between_finance_and_strategy

http://www.mckinsey.com/insights/high_tech_telecoms_internet/grow_fast_or_die_slow_the_double_edged_sword_of_m_and_a



“How M&A Practitioners Enable Their Success” – McKinsey

View PDF (7 Pages)

An update to McKinsey’s global survey of M&A

practices and capabilities in a sample of 766 firms.

It describes the currently high level of M&A activity

and the strategic risks it poses for companies that

are used to a slower tempo and annual portfolio

reviews. The article compares the approaches of firms

reporting high satisfaction with outcomes of those

reporting low satisfaction. It is worth reading this short,

well-written article to see the factors correlated with

high and low performance respectively. In short, those

who do it more often do it faster and better.

“Financial Restructuring Study 2015: Instruments & Success Factors in Practice” – Roland Berger

View PDF (38 Pages)

A good primer on the different ways for doing

financial restructures of distressed firms. What

is unusual and worthy of merit is its attempt to

statistically test which approaches work best, by

analyzing a sample of 9000 mid-to large-size German

companies over nine years. The motivation is the

changing financing environment in Germany and the

greater role being played by capital markets and PE

firms, creating more options for financial restructuring

than were traditionally available in this bank-

dominated market.

While written to explain the new game to German

companies and their shareholders and financiers,

the frameworks used are universally applicable and

provide a useful recap for managers and advisers

everywhere.

http://www.mckinsey.com/insights/corporate_finance/how_m_and_a_practitioners_enable_their_success

https://www.rolandberger.com/media/pdf/Roland_Berger_Financial_Restructuring_Study_20151023.pdf



REGULATION & COMPLIANCE

“Enabling Sustainable Compliance at Banks” – BCG

View PDF (8 Pages)

A rather generic overview of drivers of sustainable

compliance in a bank, meshing together business-

facing pillars of compliance with the right foundations

in the Compliance Department.

May be a good refresher for a generalist consultant,

but does not bring any fundamentally new thinking to

the table.

“Winning in the Era of Liquidity” – Oliver Wyman

View PDF (11 Pages)

A good article from subject matter experts at Oliver

Wyman, providing a good grounding in the science

of deposits and management of regulatory liquidity

requirements.

Not a simple topic at the best of times, but the

authors provide a good end-to-end framework for

working through the issues across the various parts

of the bank, illustrating how these come together to

deliver immediate financial impacts.

https://www.bcgperspectives.com/content/articles/financial-institutions-corporate-strategy-portfolio-management-enabling-sustainable-compliance-banks/

http://www.oliverwyman.com/content/dam/oliver-wyman/global/en/2015/sep/Winning_In_The_Era_Of_Liquidity.pdf



CORPORATE GOVERNANCE

“Communications Surveillance: Identifying & Preventing Misconduct in Digital Communications” – Accenture

View PDF (12 Pages)

A high-level primer on ways to think about detecting

possible bad behavior among rogue employees in

financial services. It argues for a “holistic approach” to

surveillance and compliance to mitigate these risks.

At times, it reads like a sales document for

Accenture. However, it also contains an outline on the

key issues and risks facing organizations today, so

makes useful background reading to gain a high-level

perspective.

“Raising Corporate Governance Standards in Indonesia” – KPMG

View PDF (4 Pages)

A brief summary of a Governance Forum that took

place in Indonesia. A quick read for anyone doing

business in the region and interested in a high-level

update on the key issues facing the boardrooms in

the country. Personally, to this reviewer it read like

notes from the conference and could be skimmed for

a few points only. In fact, it reads like a poorly written

newsletter.

https://www.accenture.com/t20151018T230052__w__/us-en/_acnmedia/Accenture/Conversion-Assets/DotCom/Documents/Global/PDF/Dualpub_12/Accenture-Communications-Surveillance.pdf#zoom=50

https://www.kpmg.com/ID/en/IssuesAndInsights/ArticlesPublications/Documents/BGF 2015 finalwriteup.pdf



HUMAN CAPITAL

“Building a Design-Driven Culture” – McKinsey

View PDF (7 Pages)

“User Experience”, “Customer Journeys”, “Design

Thinking”, “Permanent Beta” – you’ve all heard the

ever-growing list of popular, similar sounding and

somewhat ambiguous buzzwords used to describe

the holy grail of meeting customer needs through

brilliant product and experience design.

In this article, McKinsey attempts to cut through the

noise and isolate the four critical elements to create a

truly design-driven organizational culture, with a single

goal of using empathy to put customers and/or end-

users at the center of the problem solving equation.

Overall, the authors do a nice job of distilling some

of the key elements, albeit at a high level – still a useful

read for any serious digital, marketing, or human

capital leader attempting to inculcate more user-

centric, design-driven thinking into their organization.

“The Talent Revolution in Digital Marketing” – BCG

View PDF (20 Pages)

Many of us may believe (hope?) that our marketing

organizations have kept pace with the digital

revolution underway in our respective industries.

However, in this article BCG would argue this not to

be the case, citing their survey of >1,000 marketers

at nearly 60 companies in the UK and Germany who

gave themselves a less-than-impressive average score

ranking in regards to their own digital capabilities.

The authors parse the driving factors in considerable

detail, including, for example: identifying some of the

key talent and performance gaps, looking closely at

how training must keep pace, and lamenting the lack

of sufficient focus on strategy execution.

One point to note, however: key issues such as

closing the talent gap and exploring the build vs. buy

decision receive only a superficial treatment and could

benefit from more detailed analysis and examples.

http://www.mckinsey.com/insights/marketing_sales/building_a_design_driven_culture

https://www.bcgperspectives.com/content/articles/marketing-technology-organization-talent-revolution-in-digital-marketing/



DIVERSIT Y

“How Advancing Women’s Equality Can Add $12 Trillion to Global Growth” – McKinsey


This 155-page McKinsey Global Institute “Power of

Parity” report represents a truly global approach to

looking at gender parity. The authors have cleverly

constructed a compelling and innovative narrative

from their research. Fifteen gender equality indictors

(falling into four categories) have been mapped for 95

countries. 10 impact zones have been identified and

75 interventions are presented. A new MGI Gender

Parity Score (GPS) has been developed to measures

the distance each country has travelled toward gender

parity.

The Report adopts an assumption common to many

reports related to diversity – namely that women’s

inequality costs companies, countries, and individuals.

McKinsey claims that cost is $12 trillion over the next

ten years. The report supports the business case.

Where the “Power of Parity” report differs and

extends so much of the research is in the identification

of actions or “targeted interventions to drive impact.”

The most powerful section in this dense report lies

in Exhibits 24-26. These exhibits map each targeted

intervention against the impact zones and identifies

whether it is enabled by (a) Public sector and NGOs

or (b) Private sector alone or with public sector/NGOs.

The simple tables provide valuable, research-based

actions. Well worth the read to better understand the

pragmatic steps needed to realize the potential of

gender equality.

“Integrating Work & Life” – Bain

View PDF (8 Pages)

Bain & Company provides a refreshing perspective

into the work/life balance conversation. Their recent

research of 1500 millennials (MBA and business

school grads) shows that men and women want many

of the same things.

The research challenges conventional wisdom about

gender differences. Gender gaps are starting to close

on the life balance scorecard.

Bain & Company’s research shows that traditional

desires and aspirations are no longer women-specific.

Companies must consequently adapt and develop

flexible work models that truly embrace gender-neutral

aspirations.

Career, policies, values, and behaviors must all be

synchronised to appeal to people who are looking for

the same things: multiple pathways to leadership roles,

part-time employment, career breaks, sabbaticals,

working from home, and job sharing.

This research shifts the conversation away from

traditional gender diversity issues into more future

flexible inclusion issues.

http://www.mckinsey.com/insights/growth/how_advancing_womens_equality_can_add_12_trillion_to_global_growth

http://www.bain.com/publications/articles/integrating-work-and-life.aspx



“Wanted: More Women in Technology” – McKinsey

View PDF (4 Pages)

The short interview with Girls Who Code (GWC)

founder and CEO Reshma Saujani highlights the two

major activities the NFP undertakes: (1) a seven-week

immersive summer program where female students

are embedded in classrooms inside tech companies

and (2) after-school clubs that GWC sponsor (500

clubs in 34 states).

Still, the results are the same. Levels of female

participation in technology remain flat. There has

been no increase and most programs have not been

successful. There exist very few solutions to this

growing problem.

One world expert on this topic is Australian Sonja

Bernhardt, author of Women in IT in the New Social

Era: A Critical Evidence-Based Review of Gender

Inequality and the Potential for Change.

Sonja reviews the research and statistics that

support the view that current programs are failing to

keep women in the ICT field.

Sonja aims to correct this lopsided gender

distribution by presenting the “STEMcell” Model, a

unique 3D Earth-style visualization that incorporates

the influence of social media in its #SocialIT layer

and brings new recognition to the central role of the

individual at its core.

As Sonja writes: “The rules have changed, so when

viewing women in technology, it is time to adapt and

adopt the new model. It is time to consider the core

significance of the individual and the seismic digital

disruptions and tectonic technological changes we are

experiencing and move towards a new approach.”

http://www.mckinsey.com/insights/business_technology/wanted_more_women_in_technology

http://www.amazon.com/Women-New-Social-Era-Evidence-Based/dp/1466658606



FINANCE & RISK

“The CEO Interview: Willis Group on the Changing Risk Landscape” – McKinsey

View PDF (3 Pages)

This article provides a practical lens on importance

of managing risk in a global risk advisory brokerage

company, with examples of the impact of climate

change on new product development, and of

managing risk emerging from new technologies and

innovation.

Unlike a number of other articles on this topic

written by consultants, this interview provides a much

more pragmatic perspective on the need to remain

agile in making long-term and short-term resource

allocation shifts to respond to the changing global

risks and priorities.

“Stress Testing 102” – Oliver Wyman

View PDF (6 Pages)

Another good paper from the risk specialist house,

Oliver Wyman.

The paper looks beyond the usual CCAR and Dodd-

Frank Act stress testing regimes, and outlines the

virtues of forecasting capabilities of the pre-provision

net revenue (PPNR) as a key component of the banks’

planning and stress-testing toolkits.

PPNR employs statistical models that borrow

from the techniques used for risk stress testing, and

may provide wide-ranging benefits for the banks’

stress testing, strategy development, planning, and

budgeting.

A definite read for anyone looking at an alternative

capability to complement their existing stress testing

toolkit, which Oliver Wyman sees as a matter of ‘when’

rather than an ‘if’ issue.

http://www.mckinsey.com/insights/leading_in_the_21st_century/willis_group_on_the_changing_risk_landscape

http://www.oliverwyman.com/content/dam/oliver-wyman/global/en/2015/sep/Oliver_Wyman_Stress_Testing_102.pdf



“Cybersecurity – Addressing Rising Expectations: Five Critical Areas Asset Manager” – EY

View PDF (4 Pages)

Another rather generic article outlining priorities

for responding to cyber security threats, including

the usual mix of C-level sponsorship, employee

involvement and ownership, periodic risk assessment,

oversight of suppliers, and having a cyber attack

response strategy.

Not much more than a basic primer, with no new

thinking brought to the table.

“Developing a Sound Risk & Compliance Culture” – Promontory

View PDF (6 Pages)

A good primer on building blocks for sound risk and

compliance culture, in what is a very crowded space

of articles dealing with this subject matter.

This article has a fairly good checklist of

components that any risk and compliance practitioner

can quickly refer to in order to double check whether

all bases have been sufficiently covered.

http://www.ey.com/Publication/vwLUAssets/ey-us-cybersecurity-addressing-rising-expectations/$File/ey-cybersecurity-addressing-rising-expectations.pdf

http://www.promontory.com/uploadedFiles/Articles/Insights/151014_Sightlines_InFocus_RiskCulture_FINAL.pdf



MARKETING & CUSTOMER EXPERIENCE

“Making Omnichannel Work: The “To Do” List for Banks” – PwC

View PDF (11 Pages)

PwC provides a stern reminder that omnichannel

delivery is not a technological issue, as well as a re-

examining of the service delivery process. Readers

are reminded that successful omnichannel banking

depends on the successful integration of the end-to-

end customer experience.

PwC documents five major obstacles that

affect offerings and service delivery across the

operating model, ranging from cumbersome product

development processes to organizational and

operational silos. While specifically tailored to banking,

these obstacles can appear in any industry, making

this article valuable to any business that is considering

or already has omnichannel delivery.

This article offers a detailed and extensive to-do list

to work through these obstacles and strengthen your

omnichannel delivery experiences. The list is divided

into categories and includes customer experience,

product, marketing, and technologies, with the top

four actions you should take in order to improve your

omnichannel service. The articles finishes with a list of

benefits for your business once improvements to your

omnichannel experience have been activated, such

as risk reduction and happier employees. This article

will benefit service delivery managers who wish to

improve their omnichannel experience.

“Making Design a Business Priority” – McKinsey

View PDF (2 Pages)

What is the key to understanding customer wants

and needs? This McKinsey article explores how

businesses can start their transition to design thinking

in order to truly understand their customers.

The article succinctly introduces design thinking

theories and stresses the importance of why CEOs

must drive and champion design thinking. The article

also explores reasons why businesses might struggle

to implement design thinking into their day-to-day

operations, explaining that simply hiring designers

isn’t enough to create a strong design team.

This article is short but provides the framework

and questions that business leaders need to ask

themselves to ensure they successfully implement

design thinking into their business practises. It is a

worthwhile read for any business leader who wants to

better understand the role their business can play in

enhancing the lives of current and potential customers.

http://www.pwc.com/us/en/financial-services/publications/assets/omnichannelbanking.pdf

http://www.mckinsey.com/insights/operations/making_design_a_business_priority



“Bought Not Sold: Marketing & Selling to Digitally Empowered Business Customers” – Bain

View PDF (8 Pages)

Have traditional B2B marketing and sales models

reached the end of their life? This is the question

posted by Bain & Company in as they look at digitally-

empowered business customers.

The article overs a range of topics about brand

presence, the potential of customer data, and rewiring

shopping experiences for a digital medium. By

highlighting relevant industry experiences, readers are

provided with a great framework to understand what

is happening within the industry.

It is both well written and well researched, providing

a groundwork for B2B companies to adapt to digital

technologies. With a strong finish, Bain & Company

provide executives with a set of high-gain questions,

allowing them to start preparing their organizations for

digital disruption.

“Take Giant Leaps (Because You’re Not Going to Win with Timid Steps)” – BCG

View PDF (7 Pages)

This article follows the story of two young

entrepreneurs who have redefined their markets by

deeply understanding what their consumers need and

providing highly differentiated products.

The article clearly expresses the need for

businesses to keep up to date in an ever-changing

marketplace. It explains how adopting a human-

centred approach within an organization can

dramatically improve how customers perceive

their business, while subsequently improving sales.

Natura’s conviction that, “A company does not need

to make trade-offs between doing good and doing

well” reflects their increased sales through their

empowerment of local communities, customer-centric

focus, and sustainable development with investors

and customers.

http://www.bain.com/publications/articles/bought-not-sold-marketing-and-selling-to-digitally-empowered-business-customers.aspx

https://www.bcgperspectives.com/content/articles/marketing-consumer-products-take-giant-leaps/



“The Agile Marketing Organization” – BCG

View PDF (25 Pages)

The emergence of digital tools and channels has

led to rapidly-changing conditions in the marketplace.

BCG argue that in order to adapt, marketing

organizations need to increase their agility.

Having interviewed CMOs and senior marketing

executives from approximately 30 major corporations,

BCG’s article is thoroughly researched and addresses

the importance of keeping up with technological

growth in the industry. The article is well written and

provides diagrams to visualize how agile concepts

operate within the industry.

The article further outlines key areas, stages, and

concepts about a range of topics from big data

to branded content, leading its readers through

the processes behind creating an agile marketing

organization, making it an invaluable resource for

transforming your company.

https://www.bcgperspectives.com/content/articles/marketing-brand-strategy-agile-marketing-organization/



TECHNOLOGY

“Beyond Agile: Reorganizing IT for Faster Software Delivery” – McKinsey

View PDF (8 Pages)

Agile is in fashion, and this is a factor of the digital

era and subsequent pressures for businesses to

always be in a state of Beta.

Fundamental to this has been the adoption of

DevOps, which has been the enabler of moving

towards hourly deployments.

There is, however, an expectation that with those

roles, the culture and governance will need to be

adjusted to make this a reality.

“Cracking the Digital Source” – McKinsey

View PDF (11 Pages)

“I’m going Digital” is the common catch-cry that you

hear in the industry. McKinsey have a few clues from

their research, which may be useful but I fear they are

all merely ingredients.

Sponsorship, Culture, Talent, and Portfolio

management are all important, but this reviewer is not

convinced that addressing these alone will help you

crack the code.

There is an element to which one might understand

that the best chefs with the best ingredients can

create great food. But it is no guarantee, and the

intangible factor is how this all works together to

create a masterpiece.

Sorry, but if it was as easy as this ingredient list

implies, we all would have cracked the code by now.

http://www.mckinsey.com/insights/business_technology/beyond_agile_reorganizing_it_for_faster_software_delivery

http://www.mckinsey.com/insights/business_technology/cracking_the_digital_code



“Neglected, Indebted or Gold-plated: Which Type of IT Do You Have?” – Bain

View PDF (12 Pages)

Bain has advice for how you are managing the kids

(IT). Have you neglected them and treated them as a

pure cost centre?

Have they been spoilt and given gold plated

treatment? Their sage advice is that the kids are a

disappointment and budget cuts are to be expected.

Moreover, IT needs to be better at Strategy

Execution.

“TeBIT 2015 Executive Report: Digital Delivers” – BCG

View PDF (37 Pages)

This is no executive summary and is a whopping

37 pages of content. The findings are that digital

initiatives do payoff and there are improvements in

revenue that can accrue.

Another common sense finding is that complexity

leads to more cost – so make the IT Operating model

as simple as possible.

Not surprising is that most telcos do not have a true

Digital Strategy – they simply have initiatives that are

constantly being tweaked.

http://www.bain.com/publications/articles/neglected-indebted-or-goldplated-which-type-of-it-do-you-have.aspx

https://www.bcgperspectives.com/content/articles/digital-economy-telecommunications-tebit-2015-executive-report-digital-delivers/


The



SPECIAL FEATURE

The Best Insights from the Past 12 Months


The Insights Review: Special Feature

“Global Financial Markets Liquidity Study” – PwC


Water is critical to life – after 4-5 days without it, you

will die. Your reviewer contends that liquidity – please

excuse the pun – is as important to our financial

markets and by extension, economy, today. If you are

reading this, then you should at least scan the executive

summary of the comprehensive, academically-styled

report by PwC, as this matters to you.

Whether you are a senior policy setter or a junior

financial services practitioner, you will find value and

insight in this document. It is likely that the former will

find more of pertinence in the chapters on the Drivers

of future financial markets liquidity (chapter 5) and

Policy considerations (chapter 6), while the latter will

do so in chapter 2, entitled ‘What is liquidity?’.

An extract from the report’s synopsis underlines

the importance of your attention to this topic: “Thus,

the study concludes that current and future market

liquidity is a subject of concern for market participants.

It further finds that there are grounds for a review of

the calibration of the reforms to date and the ongoing

regulatory agenda, in order to properly understand

and consider the effects of regulatory initiatives

on market liquidity by asset class, and to consider

whether upcoming regulatory initiatives could likely

exacerbate the trends in liquidity.”

“Technology Vision for Insurance 2015. Digital Insurance Era: Stretch Your Boundaries” – Accenture

View PDF (9 Pages)

Like the preceding Bain article, this 40-page report

is another must-read for executives and internal

consultants alike.

This is the best view your review has seen of the

interlocking pieces currently seen as ‘digital’ in

insurance.

• The article talks to five key themes:

• The internet of me;

• Outcome economy;

• The Platform (R)evolution;

• The Intelligent Enterprise;

• Workforce Reimagined.

The themes are all well-developed at the strategic

level. Detailed views on short- and medium-term plans

to embrace and deliver are then set out in a well-

ordered and challenging way.

Supporting all of the above are insightful case

studies, examples, and compelling research findings

showing how much traction is already being made

by the companies that ‘get it’ in the insurance world,

moving from ‘me’ to ‘we’.

A compelling piece from the well-established

technology laboratories within Accenture.

SEPTEMBER 2015 AUGUST 2015

https://www.accenture.com/ie-en/insight-technology-vision-insurance-2015

http://www.pwc.com/gx/en/industries/financial-services/publications/financial-markets-liquidity-study.html



“Fixing the Insurance Industry: How Big Data can Transform Customer Satisfaction” – Capgemini

View PDF (13 Pages)

A short read but well researched, evidenced, and

exampled by Capgemini, making it a very insightful

piece for both executives and internal consultants.

The article presents a wide-view on the need for

constraints of current business models and data use

supported by good industry-wide examples. The

references list is impressive and makes for a must-

read article if only because “globally, less than a third

of customers are satisfied with the services of their

insurance providers” is explored from all directions.

A real contender for Article of the Month given its

different perspective grounding and developing a well-

covered theme.

“Evidence-based HR: The Bridge Between Your People & Delivering Business Strategy” – KPMG

View PDF (32 Pages)

Compelling insight based on academic input, a

large global C-suite survey, and some fascinating work

from KPMG’s Global HR Centre for excellence.

Drawing from the slow adoption of evidence in the

medical field, KPMG explains some of the factors

which may have hindered its evolution (HR data

science capabilities low, insufficient resources, or poor

expected return), but with some inspiring case studies

(see the one from McDonalds on page 21). The result

is that the reader is left in no doubt that evidenced-

based HR is coming to your organization soon. Highly

recommended for all internal consultants and leaders.

JULY 2015 JUNE 2015

https://www.capgemini-consulting.com/fixing-the-insurance-industry

https://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/Documents/evidence-based-hr.pdf


“Global Corporate Banking 2015. The Look of a Winner” – BCG

View PDF (26 Pages)

This is an excellent article by BCG and a must read

for corporate and business banking executives and

their internal consultants. It sets out five waves of

disruptive megatrends that are swamping these profit

engines for the banks that own them.

The article goes on to make the case for eight - not

new - actions that require urgent attention from those

with the courage to chart a path to success.

On review of these actions readers are highly likely to

acknowledge their veracity, so it is worth reflecting

that the Corporate Banking sector has been retarded

by its traditional business models, which are no longer

as fit for purpose as they once were.

If you found this article of relevance to your

challenges and seek more in-depth insight, ICG

has published a Knowledge Area Review (KAR) on

this topic: Innovation in the Business Banking Value

Proposition. The brochure can be found here.

“Peer Pressure: How Peer-to-peer Lending Platforms are Transforming the Consumer Lending Industry” – PwC

View PDF (18 Pages)

An excellent overview of a rapidly emerging finance

category predicts that the P2P lending market could

grow from $5 billion to $150 billion in the US alone

within the next 10 years, as it matures and expands

into mortgage, business, and other asset classes. The

article includes a useful overview of the P2P lending

ecosystem, including the role of the various platform

participants, the loan origination process flow, and the

customer experience.

PwC offers two alternative paths by which banks

may respond to the P2P challenge: either through

collaboration (as an investor or white label partner) or

through competing directly.

This is an important subject handled with balance

and insight, and will be of interest to both banking

executives and consultants looking for up-to-date

perspectives across what may become a key

disruptive force across consumer lending.


MAY 2015 APRIL 2015

https://www.bcgperspectives.com/content/articles/financial_institutions_business_unit_strategy_global_corporate_banking_2015/

http://internalconsulting.com/store/product/innovation-in-the-business-banking-value-proposition/

http://www.pwc.com/us/en/consumer-finance/publications/peer-to-peer-lending.jhtml


“A 2015 Regulatory Challenge for Banks” – EY

View PDF (6 Pages)

There is a lot to like in this short and pithy article

from a global brains trust at EY. It is designed for

executives, it gets to the point quickly, it outlines what

the key issues are (resolution, capital, and liquidity)

and then sets out a CEO- and board-level response

agenda with good and well-articulated initiatives. For

those looking for a role model insight, this is it.

“Are Banks Prepared for a New Turning Point in the Retail Banking Landscape?” – Roland Berger

View PDF (8 Pages)

A helpful insight that provides further evidence of

Roland Berger’s continued ascendancy in the global

consulting industry. This short article really makes two

points: firstly, Roland Berger put a stake in the ground

that the turning point is now here; and secondly, it

introduces a checklist of strategic consideration

presented in a very compelling and neat wheel

framework (which already needs some refinement).

However, for most internal consulting teams and

executives in retail banking, this article provides a

helpful reminder with more zeal and panache than the

traditional PEST and 5 Forces frameworks.


FEBRUARY 2015 JANUARY 2015 – DECEMBER 2014

http://www.ey.com/Publication/vwLUAssets/ey-regulatory-challenges-for-banks-in-2015/$FILE/ey-global-regulatory-network-2015-regulatory-challenge-for-banks.pdf

http://www.rolandberger.com/media/pdf/Roland_Berger_Retail_Banking_20141017.pdf


“Consumerized Employee Experiences Can Boost Workforce Productivity” – Accenture

View PDF (17 Pages)

A fascinating article that explores the simple idea of

treating employees in the same way they are treated

as consumers by global best-in-class companies.

Put another way, Accenture argues for an ‘employee

needs-based’ approach to managing shared

services, rather than the typical functional silos that

characterise most organizations we are familiar with.

From identifying ‘moments that matter’ and

leveraging data and analytics through to providing

cross-trained ‘enhanced advisors’ to ‘delight

employees’, the authors provide several ideas and

examples on how to more efficiently and effectively

address common employee needs (such as travelling

for business, requiring a new computer, or even taking

approved time off) using principles of customer-

centricity.

Excellent piece with some real thought-provoking

case studies – a must read for any forward-thinking

human capital practitioner.

“Evolution & Revolution: How Insurers Stay Relevant in a Digital Future” – BCG


A very substantial Blue Paper collaboration piece

based on global analysis by the two firms’ insurance

and IT practices, including 56 senior executive

interviews across 12 countries. The main text (running

to 30-plus pages) is supported by a formidable deep

dive of a further 90 pages of excellent material. The

executive summary provides a very good quick read

to set the scene for the main text and the subsequent

deep dive text.

A huge resource featuring excellent case studies,

scenarios, and IT vendor profiles all linked in a

cohesive way – a must-read for all senior executives

involved in future-proofing their organizations.


OCTOBER 2014 SEPTEMBER 2014

http://www.accenture.com/us-en/Pages/insight-consumerized-employee-experiences-workforce-productivity.aspx

https://www.bcgperspectives.com/content/articles/insurance_technology_strategy_evolution_revolution_how_insurers_stay_relevant_digital_world/


“Kill Your Performance Ratings” – Strategy&

View PDF (12 Pages)

A thought-provoking and robust “must-read” for

any leader or HR Director wanting to create and

sustain a high-performance organization. A thorough

examination of the evidence is provided in support

of the premise that performance rating systems are

misleading, cumbersome, complex, and frequently

damage the very performance they are intended to

improve.

The rather strong statement “If you want a high-

performance organization, you have to reverse the

destructive effects of conventional performance

management” is likely to be somewhat confronting to

those many who have been immersed in overseeing

and implementing conventional “rank and yank”

performance management processes for so long.

At the very least, this paper deserves a thorough

read-through (several times, perhaps) with careful

attention paid to the ways in which performance

rankings trigger adverse reactions in people in relation

to all five of the SCARF factors which are posited to

have immense effects on negative human reactions:

status, certainty, autonomy, relatedness, and fairness.

It is not proposed that the baby be thrown out with

the bath water. In transitioning to a no-rating system,

two options are put forward as alternatives; structured

conversations or guided conversations, and there is

some discussion of these approaches and how the HR

Department and company can provide a framework,

guidance, and possibly training on how managers

need to address the key topics to be covered.

For those who might be inclined to dismiss the

perspectives offered in this paper out of hand, the

challenging statement that “only one person feels

neurologically rewarded by the (rate and rank)

performance management exercise: the senior

executive who oversees it” certainly warrants

some introspection.

“The State of the European Banking Industry” – Roland Berger

View PDF (42 Pages)

Wow – this is an exceptional coming of age report

for Roland Berger in financial services. Its focus

is, of course, Europe, with benchmarking across

Europe and occasionally to the US for retail, CIB, and

insurance and investments.

Helpfully, the report is in slide format and

contains a rich mix of analysis, framing, insight and

recommendations. It also tries to coin a new acronym

‘GAFA’ for the combined disruptive power of Google,

Amazon, Facebook, and Apple.

Don’t forget the Appendix – we especially liked

pages 35 and 36.

Excellent work.


AUGUST 2014 JULY 2014

http://www.strategy-business.com/article/00275?pg=all

http://www.rolandberger.com/media/pdf/Roland_Berger_State_of_European_Banking_Industry_20140721.pdf


The Insights Review – FS Edition Team

Candidate insights are compiled by an

expert team of researchers. Reviews are

written by partner-level subject matter experts

from our industry and functional practices.

CHIEF REVIEWER

David MoloneyICG Practice Leader Financial Services

EDITOR

Andrew Wilson

INSIGHT REVIEWERS

The Insights Review draws its insight

reviewers from over 1000 of the most senior

professional consultants around the world.

Key contributors this month include:

Andrew Boyes-VarleyICG Practice Leader Strategy

Barry JohnstonICG Practice Leader Wealth Management & Superannuation

Brad ClarkeICG Subject Matter Expert

Catherine NortonICG Practice Leader Diversity

Damian KernahanICG Subject Matter Expert

David GeeICG Practice Leader Strategic IT

Henri EliotICG Practice Leader Corporate Governance

Jacek NogaICG Subject Matter Expert

Julian CappeICG Practice Leader Retail & Business Banking

K Paul BlondICG Subject Matter Expert

Keith LandICG Practice Leader Insurance

Rajesh GokhaleICG Practice Leader Human Capital

Richard DaleICG Subject Matter Expert

ICG Service PromiseWe hope you have found ICG’s The Insights

Review – Financial Services Edition valuable.

If any aspect of this publication could be

improved, please contact:

[email protected] ►

For Further InformationThis review is one of many value-added

services to help executives, internal project

teams and internal consultants improve their

effectiveness. For a full range of services, visit:

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DISCLAIMERICG has made and will make good faith efforts to ensure that The Insights Review is a high quality publication, and a reasonable interpretation of the material it purports to review. However ICG does not warrant completeness or accuracy, and does not warrant that the Subscriber’s use of the Report through ICG’s provisioning service will be uninterrupted or error-free, or that the results obtained will be useful or will satisfy the user’s requirements. ICG does not endorse the reputations or opinions of any third party source represented in the review.

COPYRIGHT NOTICEWhile third party materials have been referenced and analyzed in this report, the content of this report represents the original work of ICG’s personnel. The Insights Review is subject to copyright. ICG is the legal copyright holder. No person may reproduce the review without the explicit written permission of ICG. Use of the copyright material in any other form, and in any medium whatsoever, requires the prior agreement in writing of the copyright holder. The Subscriber is allowed “fair use” of the copyright material for non-commercial, educational, instructional, and scientific purposes by authorised users.



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